Uttarakhand High Court
Ujvn Limited vs Hydel Construction Pvt. Ltd. & Another on 30 June, 2015
Author: Servesh Kumar Gupta
Bench: Servesh Kumar Gupta
IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL
Money withdrawal application (CLMA No.5954 of 2015)
In
Appeal from Order No. 358 of 2014
UJVN Limited .... Appellant
Versus
Hydel Construction Pvt. Ltd. & another .....Respondents
Mr. Vinay Kumar, Advocate for the appellant.
Mr. V.K. Kohli, Sr. Advocate assisted by Mr. H.M. Bhatia, Adv. for the respondent no.1.
Mr. Sayed Nadim, Standing Counsel for the State/respondent no.2.
With
Money withdrawal application (CLMA No.5955 of 2015)
In
Appeal from Order No. 359 of 2014
UJVN Limited ....
Appellant
Versus
Hydel Construction Pvt. Ltd. & other ... Respondents
Mr. Vinay Kumar, Advocate for the appellant.
Mr. V.K. Kohli, Sr. Advocate assisted by Mr. H.M. Bhatia, Adv. for the respondent no.1
Mr. Sayed Nadim, Standing Counsel for the State/respondent no.2.
June 30, 2015
Hon'ble Servesh Kumar Gupta, J.
The burning issue before this Court instantly is whether the money deposited by the appellant should be permitted to be withdrawn by the respondent contractor?
Pursuant to an agreement between the parties, two awards were passed by the arbitrators. Award dated 15.7.2012 is the subject matter of Appeal No. 358/2014, while the award dated 22.5.2013 is questioned in Appeal No. 359/2014. By the order of this Court, fifty per cent of the awarded amount has been deposited by the appellant with the Registrar General of this Court, while for the rest of the fifty per cent, bank guarantee has been furnished.
2Objections against the award under Section 34 of the Act were rejected by the District Judge on 24.5.2014 in both the matters and rejection of such objections has been challenged by way of filing these appeals on 27.8.2014. This Court stayed the execution of the impugned awards subject to deposit of the amount as aforestated.
When the merits of the case were countenanced to some extent during the course of arguments, then the Court asked the learned Sr. Counsel for the respondents not to press the money withdrawal applications so vehemently and instead he should be prepared to submit the arguments in details, but disinclination was shown. So, this Court was constraint to permit the either parties to submit their rival contentions on the issue of money withdrawal only.
Learned Sr. Counsel of the respondents has relied upon a plethora of judgments as under:
(1) Vipul Agarwal Vs. Atul Kanodia & Co. and another, AIR 2004 Allahabad 205;
(2) Decor India Pvt. Ltd. Vs. National Building Construction Corporation Ltd, 142 (2007) Delhi Law Times 21 (DB);
(3) Sarkar and Sarkar Vs. State of West Bengal & Ors. AIR 2006 Calcutta 149;
(4) National Aluminum Co. Ltd. Vs. Pressteel & Fabrications (P) Ltd. (2004) 1 SCC 540; and (5) Morgan Securities and Credit Pvt. Ltd. Vs. Modi Rubber Ltd. AIR 2007 SCC 683.
Ultimately, he relied upon an of late judgment of Hon'ble Apex Court rendered on 3.1.2014 in Civil Appeal No. 26 of 2014, Kanpur Jal Sansthan & Anr. V. Bapu Constructions. It was a similar arbitration matter, where 3 the award was passed by the arbitrator and the objections under Section 34 of the Act were rejected. Then under Section 37 of the Act, during the course of appeal, Hon'ble Allahabad High Court permitted withdrawal of money by the respondents to the extent of fifty percent of the deposit without furnishing any security and remaining half after furnishing the security.
I have gone through the aforementioned judgment and paragraph 31 thereof reveals that the Hon'ble Apex Court had observed that "High Court has not given any justifiable reason for permitting such withdrawal. Without commenting on the merits of the grounds sought to be urged before us (to which we have not referred to in detail not being necessary) we only modify the order that the appellant shall furnish the security for the entire amount to the satisfaction of the concerned District Judge within a period of six weeks."
It is abundantly clear that the argument of the learned Sr. Counsel of the respondents that the Hon'ble Supreme Court permitted the withdrawal of the entire amount is not correct because the Apex Court did not permit the withdrawal of the entire amount which was deposited as per the orders of the High Court at the time of granting stay on the execution after filing the appeal under Section 37 of the Act, but observed that the fifty per cent amount was permitted to be withdrawn by the High Court without giving any justifiable reason and for that entire amount of fifty per cent, which had been permitted to be withdrawn by the High Court, the appellant was asked to submit the security to the satisfaction of the District Judge concerned. So, the argument of learned Sr. Counsel for the respondents that Hon'ble Apex Court was always in favour of permitting the withdrawal of deposited money during the 4 course of appeal under Section 37 of the Act is wholly misconceived.
The significant question which has been surfaced is whether after the rejection of objections under Section 34 of the Act, the award has become final to make it enforceable like money decree under Section 36 of the Act? My answer is emphatically "No" because before the words "decree by the Court" at the end of the Section, the word "money" has not been written there. Had the Legislature intended to make it enforceable like a money decree, then it should have specifically written so in Section 36 of the Act, instead of simple "decree of the Court". More so, because if such an argument is accepted for a moment, then the provision of Section 37 of the Act will loose its relevance and propriety.
My view is fortified by the judgment of a coordinate Bench of this Court rendered in Writ Petition (M/S) No. 2050/2012 on 21.5.2015, Uttarakhand Rural Road Development Agency and Another v. District Magistrate and Others.
Learned Counsel of the appellant has also relied upon a number of judgments. In one such verdict rendered on 13.8.2012 in F.M.A. No. 254 of 2012, M/s National Highways Authority of India vs. M/s B. Seenaiah & Company (Projects) Limited, several judgments of the Apex Court have been referred in paragraph 3 of the same, and the Division Bench of the Calcutta High Court has not held otherwise.
That apart, it was argued by the learned Sr. Counsel of the respondents that two coordinate Benches and even this Court at some different occasions had released the amount deposited during the course of appeal under Section 37 of the Act. I have perused all those orders and find that such orders apparently were passed without 5 having gone through deeply the intricacies and implications of the statutory laws in this regard as the same were not put forth by the Counsel of either parties. So, a very short order of a paragraph or two were passed at different occasions releasing the amount in different cases.
During the course of brief submissions, learned Counsel of the appellant divulged certain very important aspects which make the award questionable and looking to the seriousness of such implications, this Court feels that these appeals should be heard on merits before passing any order pertaining to the release of amount, which is not a small one.
In view of what has been stated above, the money withdrawal applications in both the appeals are hereby rejected.
Respondents shall be at liberty to move urgency application for final disposal of these appeals at the earliest, if they so desire.
It is directed that the fifty per cent amount, which the appellant has deposited with the Registrar General of this Court, shall be invested in the form of TDR in a nationalised bank so that the same may earn the maximum interest.
(Servesh Kumar Gupta, J.) Prabodh